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H B
OME
UILDERS
A
SSOCIATION
NEWSBRIEF
The Official Newsletter of the Home Builders Association of Greater Southwest IL
To promote, educate and advocate for the Residential Building & Remodeling Industry; providing
resources that benefit industry professionals and consumers in the communities we serve.
February 2018 issue
www.hbaswil.org
Installation of Officers
& Industry Awards
Banquet
Thank you to everyone
that was able to join us
for a wonderful evening
filled with recognition,
congratulations, cheers
and laughter.
It is with great pleasure
to introduce our
2018 HBA President
Chris Matteo
Fulford Homes
Complete coverage and
details of the evening
will be shared in the
March Newsletter!

The owners of this house were wavering
between a new home or staying
and conforming their current home to fit
their needs and lifestyle. After seeing
the virtual reality transformation that
could be accomplished they was not
question but to renovate.
The renovations gave this house exactly
what the owners needed for their
family.
This home is located on a popular lake and
fell behind in both design and upkeep. When
entering the home it was stepping back into
1970’s.
All of the renovations within the home truly
lightened up the space while bringing in better
views of the lake along with an additional
bedroom allowing the family to continue their
gatherings for generations to come.
Now everyone can enjoy the lake at it’s best.
This historic farm house built in 1900 was in
desperate need of a kitchen remodel.
The client requested to include current features
with a high-end historic look.
The final renovations did exactly as the client
asked and brought older country charm into
the current times. Adding nostalgia is the custom
cabinetry made from cherry trees off of
the 40 acre farm.

Economic Forecast 2018: Like 2017 But Slightly Better
The combination of solid, widespread global
growth; strong labor markets; low inflation;
improving commodity prices; a slightly weaker
dollar; and continued easy monetary policy from
most central banks sets the stage for a good
year. Moreover, the recently passed front-loaded
tax cuts here in the US will help by adding a
pleasant tailwind to the domestic economy. The
possibility of increases in infrastructure and
defense spending, along with the continued
deregulatory efforts of the Trump administration,
make the domestic economic landscape heading
into 2018 as strong as it has been since the end
of the Great Recession.
However, there are also economic headwinds.
The fear of inflation could spook the Federal
Reserve to raise rates more rapidly than
expected, which would slow growth and unsettle
financial markets. A large confidence-shattering
drop in the stock market, for any number of
reasons, might hurt the economy. With the now
low tax rate on repatriated earnings, American
firms might bring back substantial profits from
abroad, and in the process, boost the dollar,
which will hurt manufacturing activity. Lastly,
geopolitical problems always lurk and could
easily have negative growth implications.
With all this in mind, I expect full-year 2018 GDP
to come in at 2.6%, slightly higher than the 2.3%
growth experienced last year and the 2.1%
average rate of growth since the end of the
Great Recession. Headline inflation looks to pick
up from roughly 2% to 2.3% in 2018, while core
inflation (which excludes food and energy) will
edge up only slightly. Because of the slow rise in
core inflation, the Federal Reserve will probably
have the luxury of time to raise the federal funds
rate from where it is now, at 1.375%, to 2.125%
by year’s end, with a quarter-point rate increase
roughly every three or four months with the first
one in March.
Turning our attention to the labor market, I
expect net new monthly job growth to average
150,000/month, which, while down from
167,000/month in 2017, is excellent given that
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we are late in the business cycle and few
potential workers remain on the sidelines. The
unemployment rate will fall from 4.1% today to
3.6% or even 3.5% by year end, a rate not seen
since the late 1960s! As the labor market
tightens, nominal wage growth should increase
in 2018, with average annual wage increases
rising from 2.4% to 2.75% and as much as 3%
by the end of the year: a healthy rise.
Because of faster GDP growth and the falling
unemployment rate, 10-year Treasuries will end
2018 at 2.75%, and the rate on 30-year
mortgages will be at or near 4.40%. However,
continued easing of credit conditions and rising
consumer spending due to continued strong
employment growth and better wage growth will
keep the economy and housing market on track.
Despite passage of the new tax
bill, which is likely to modestly
slow home sales and house
price appreciation in some high
-cost areas because of the
reduced benefits of
homeownership, housing starts
should increase by about 7%, to 1.29 million.
Single-family starts will likely total 930,000, up
from 850,000, while multifamily starts should
flatline at about 360,000. New and existing
home sales should collectively rise by about
3% and end the year at 6.35 million, with
mortgage purchase volume advancing by $100
billion, and refinance activity falling by about
$200 billion due to the rise in mortgage rates.
Housing inventories will, regrettably, remain
unchanged, and combined with limited new
home building, home prices will rise by 5%.
Motor vehicle sales will slip to 16.5 million from
17.1 million and the chances of a recession in
2018 is low given the very solid global
economic conditions that currently prevail.
I
peg the chances of a recession in 2018 at just
15%.
Elliot Eisenberg, Ph.D., President
GraphsandLaughs, LLC
Email: Elliot@graphsandlaughs.net
His daily 70 word economics and policy blog
can be seen at www.econ70.com

Things Learned at the Builders Show
Bill Ward, Executive Vice President, HBAI
The 2018 International Builders Show and NAHB Board Meeting were held in Orlando. The second largest trade
show in North America attracted an estimated 87,000 builders and associates from around the world. Held in
conjunction with the Kitchen & Bath Show, there is no place on Earth to learn more in one week about your business,
your association, and your industry. Here are some bullets of information I gathered at this year’s IBS.
Government Affairs
1. Tax Reform has landed and it is now time for all of us
to take a deep dive into how it will affect our individual
& business taxes. NAHB is creating a webinar for this
that will be available to all members and HBAI has
requested a knowledgeable NAHB staffer to come to
our state to provide guidance on what you need to know
about tax reform.
2. Did you know that dropping the cap on home mortgage
interest deduction from $1 million to $750,000 still
includes 98.7% of all home mortgages in the U.S.? This
may be a loss to us, but it wasn’t a bad one.
3. 34 million Americans filed itemized tax forms for their
2016 taxes. It is estimated that this number will drop to
14 million. Will that be bad for home ownership or will
increased net income mean more home buying?
4. The price of softwood lumber and drywall may go up so
Association Affairs
 The NAHB Board of Directors passed the Governance Bylaw
changes allowing a more executive style board (corporate
council) to operate most NAHB matters. The 1200 member
BOD will be referred to as Delegates in the future and will
still have the ultimate authority to make bylaw changes.
 Sooner or later, NAHB wants to go to a centralized, online
membership payment process. Illinois State & Local
Associations need to work together now to discuss our needs
for functioning in a centralized, online system. We want every
local to have a system that easily pays dues, makes payments
for special events, and allows negative PAC fund checkoffs.
 A third meeting of the NAHB Board of Directors will be put
back into place in 2019. The IBS, a Mid-Year meeting in
Washington, D.C., and third meeting that moves around the
country will be back on the calendar like it was for many
years.
 Did you know that National Area Chair, Mike Nagel from
Illinois, sponsored the resolution to bring back the third
meeting?
 Chuck Fowke of Tampa, Florida defeated Fred Hoppe of
Lincoln, Nebraska for 3rd Vice Chair at NAHB. Randy Noel
of La Place, Louisiana was unanimously installed as the
Chairman of the Board for NAHB.
 Kevin Chaffin is once again our State Representative to
NAHB from Illinois and will have a seat on the new
Corporate Council once it is initiated.
You can experience the same when you attend the 2019
IBS in Las Vegas - February 18, 19, & 20th
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much this year that NAHB has developed a “cost
adjustment clause” for builders to place in their
contracts to protect their profit margins. Call or write
for more information.
5. 2017 was the most expensive year for natural disaster
damage. Stronger building codes could result from this.
6. New Construction is back in the House Flood Insurance
bill. This is good.
7. U.S. EPA is working on a new rule to replace the
Obama WOTUS rule. U.S. Supreme Court to rule on
WOTUS this year.
8. Bring Housing Home is scheduled for April 30 thru
May 5, 2018. Do you know what that is? Call or write
for more information.
9. NAHB wants President Trump to move on the Dreamers
issue. We need to solve the Visa issue for our industry.
Politics
 There will be 45 open seats in the U.S.
Representative 2018 elections; 30 of those seats
are in Republican districts.
 11 Democratic Senators are running for reelection
in Republican States.
 Arizona will have two open seats with the
eminent departure of Senator John McCain.
 4. BuildPAC has raised $1.2 million in this
election cycle (2017/2018). Their goal is to raise
$3 million in total this year.

The show was an exciting time for our organization as our HBA was recognized for
hard work and contributions made to the industry!
Local Councils WON these prestigious awards!
Professional Women in Building Council
 Council of the Year (second year in a row)
 Outstanding Innovative Program for their work
connecting with local leaders and their role at
SAFB Air Show & Open House.
 Outstanding Legislative & Political Action
Program for their work with local government
officials who play a vital role in developing and/or
amending regulations that impact our industry.
Remodelers Council
 Jon Edler with Henges Interiors for winning
the new award “One to Watch” that honors a
remodeler member under the age of 40 who is an
advocate for the remodeling industry, engages
with peers, and has embedded themselves as
exceptional members of their communities.
Jon Edler (center) receiving his award
from NAHB Remodelers
Tracy Butler, HBA Executive Officer
Michelle Null, 2018 PWB Chair
Beth Jacob, 2016 PWB Chair
Cherity Freeze, 2017 PWB Chair
Jan Johnson, 2015 PWB Chair
Jan Johnson presenting the NAHB
PWB Woman of the Year Award
Jon, Tracy & Mark Gau touring the
Remodeled Home before the
ceremonies
Most of the gang stuck around to enjoy the concert from Chicago
Chillin’ out
after long days
of meetings
and walking
the show floor
at Blue
Martini & the
Ice Bar
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